D.C. law firms beef up their antitrust practices

When Christine Varney, President Obama’s pick to lead the Justice Department’s antitrust division, took office in 2009, one of her first acts was to toss out a set of guidelines regulating monopolistic practices issued just months earlier by her predecessor.

The guidelines didn’t go far enough to protect consumers and “raised too many hurdles” to antitrust enforcement, she said.

Many credit Varney with bringing renewed vigor to an agency that critics said had grown too lax under the Bush administration, even as the antitrust arm of the DOJ went on to approve several behemoth mergers — among them Comcast’s acquisition of a 51 percent stake in NBC Universal, and Ticketmaster’s controversial purchase of Live Nation.

With creds like his work at the Federal Trade Commission, Jeffrey Brennan is a valued pickup for McDermott Will & Emery. (Jeffrey MacMillan/For Capital Business)

The prospect of tougher scrutiny and more blockbuster deals has set off a flurry of activity in Washington’s antitrust community, as key firms look to strengthen their practices, often with former regulators and top rainmakers.

Varney herself has taken advantage of the renewed interest, announcing earlier this month that she would leave her post for Cravath, Swaine & Moore. (Cravath declined to comment on the hiring other than to say that Varney’s first day will be Sept. 6.)

Her departure is the latest of several high-profile moves in recent months — including those of former Federal Trade Commission chairman Tim Muris and his former chief of staff, Christine Wilson, who exited O’Melveny for Kirkland & Ellis.

“You’re seeing firms like Kirkland and Cravath try to bolster their antitrust capabilities with high-profile, talented hires,” said Gene Assaf, a partner at Kirkland and member of the firm’s hiring committee. “When you have the top 10 to 20 firms doing a significant amount of [merger and acquisition] work, it’s compelling to have someone with a unique government regulatory perspective because the deals have become so significant.”

Recruiting Muris and Wilson as lateral hires from O’Melveny was somewhat unusual for Kirkland, a firm that typically grows from within. But the move paid off quickly. During their first week, the duo helped put together a $6.8 billion deal between Teva Pharmaceuticals, the world’s largest generic drugmaker by sales, and smaller Israeli drug manufacturer Cephalon.

Some say firms are being more cautious about hiring younger partners than in the past, and are courting older rainmakers so the firm can inherit their book of business after they retire.

“When the crash came, lots of attorneys doing antitrust went elsewhere or firms pared down their practice groups,” said Steven Newborn, co-head of the global antitrust and competition practice at Weil, Gotshal & Manges. “Now, many firms are trying to build them up again. I think their philosophy is, ‘Why not build it up at the very top?’ There’s not been a time in the recent past where so many law firms are interested in acquiring antitrust rainmakers.”

Younger partners — what the legal world calls investment hires — are far less in demand than they once were, said Jeffrey Lowe, managing partner of the Washington office of Major Lindsey & Africa, a national legal recruiting and staffing firm.

“Following the downturn of 2008, we’ve seen a decrease in the willingness to make those hires,” Lowe said. “Practice heads might love a young partner, but they have to bring it to firmwide management for approval. Firmwide management thinks, ‘What’s the business justification for adding this young person?’ They’re much more inclined to go forward with someone with a built-in practice where there’s an expectation that several millions in business will immediately follow.”

Not everyone agrees. McDermott Will & Emery is beefing up its antitrust group on multiple fronts, hiring four associates within the last year with plans to hire as many as three more before the end of 2011. The firm is also building from the top, bringing in Jeffrey Brennan, a former associate director at the FTC, from Dechert. Brennan’s move last week follows that of Alison Smith, a former prosecutor in the Justice Department’s antitrust division, who joined McDermott from Vinson & Elkins last fall.

“Here, and for most firms, there’s a market uptick in transactional activity,” said Joe Winterscheid, head of McDermott’s global antitrust and competition practice group. “Things were slower for a time but that’s now trending up. We’ll look to continue to expand as the work continues to expand, as we expect it will.”

In March, Baker Botts grew its antitrust practice from six lawyers to 50 in one fell swoop, snapping up 45 antitrust attorneys from Howrey when the firm folded. Baker Botts said the move was part of a 15-year strategic plan, and is now planning to open an office in Brussels, with 10 lawyers specializing in antitrust and competition.

“What we’re seeing is not so much growth — you can’t create antitrust lawyers overnight — as repositioning in the marketplace,” said Sean Boland, co-chairman of the Baker Botts global antitrust practice and part of the Howrey team that joined in March. “Firms that are strong in antitrust that had a good couple of practitioners didn’t have the depth they wanted. Baker Botts has always done antitrust deals but the Howrey group gave the firm additional scope and scale.”

When Christine Varney, President Obama’s pick to lead the Justice Department’s antitrust division, took office in 2009, one of her first acts was to toss out a set of guidelines regulating monopolistic practices issued just months earlier by her predecessor.

The guidelines didn’t go far enough to protect consumers and “raised too many hurdles” to antitrust enforcement, she said.

Many credit Varney with bringing renewed vigor to an agency that critics said had grown too lax under the Bush administration, even as the antitrust arm of the DOJ went on to approve several behemoth mergers — among them Comcast’s acquisition of a 51 percent stake in NBC Universal, and Ticketmaster’s controversial purchase of Live Nation.

The prospect of tougher scrutiny and more blockbuster deals has set off a flurry of activity in Washington’s antitrust community, as key firms look to strengthen their practices, often with former regulators and top rainmakers.

Varney herself has taken advantage of the renewed interest, announcing earlier this month that she would leave her post for Cravath, Swaine & Moore. (Cravath declined to comment on the hiring other than to say that Varney’s first day will be Sept. 6.)

Her departure is the latest of several high-profile moves in recent months — including those of former Federal Trade Commission chairman Tim Muris and his former chief of staff, Christine Wilson, who exited O’Melveny for Kirkland & Ellis.

“You’re seeing firms like Kirkland and Cravath try to bolster their antitrust capabilities with high-profile, talented hires,” said Gene Assaf, a partner at Kirkland and member of the firm’s hiring committee. “When you have the top 10 to 20 firms doing a significant amount of [merger and acquisition] work, it’s compelling to have someone with a unique government regulatory perspective because the deals have become so significant.”

Recruiting Muris and Wilson as lateral hires from O’Melveny was somewhat unusual for Kirkland, a firm that typically grows from within. But the move paid off quickly. During their first week, the duo helped put together a $6.8 billion deal between Teva Pharmaceuticals, the world’s largest generic drugmaker by sales, and smaller Israeli drug manufacturer Cephalon.

Some say firms are being more cautious about hiring younger partners than in the past, and are courting older rainmakers so the firm can inherit their book of business after they retire.

“When the crash came, lots of attorneys doing antitrust went elsewhere or firms pared down their practice groups,” said Steven Newborn, co-head of the global antitrust and competition practice at Weil, Gotshal & Manges. “Now, many firms are trying to build them up again. I think their philosophy is, ‘Why not build it up at the very top?’ There’s not been a time in the recent past where so many law firms are interested in acquiring antitrust rainmakers.”

Younger partners — what the legal world calls investment hires — are far less in demand than they once were, said Jeffrey Lowe, managing partner of the Washington office of Major Lindsey & Africa, a national legal recruiting and staffing firm.

“Following the downturn of 2008, we’ve seen a decrease in the willingness to make those hires,” Lowe said. “Practice heads might love a young partner, but they have to bring it to firmwide management for approval. Firmwide management thinks, ‘What’s the business justification for adding this young person?’ They’re much more inclined to go forward with someone with a built-in practice where there’s an expectation that several millions in business will immediately follow.”

Not everyone agrees. McDermott Will & Emery is beefing up its antitrust group on multiple fronts, hiring four associates within the last year with plans to hire as many as three more before the end of 2011. The firm is also building from the top, bringing in Jeffrey Brennan, a former associate director at the FTC, from Dechert. Brennan’s move last week follows that of Alison Smith, a former prosecutor in the Justice Department’s antitrust division, who joined McDermott from Vinson & Elkins last fall.

“Here, and for most firms, there’s a market uptick in transactional activity,” said Joe Winterscheid, head of McDermott’s global antitrust and competition practice group. “Things were slower for a time but that’s now trending up. We’ll look to continue to expand as the work continues to expand, as we expect it will.”

In March, Baker Botts grew its antitrust practice from six lawyers to 50 in one fell swoop, snapping up 45 antitrust attorneys from Howrey when the firm folded. Baker Botts said the move was part of a 15-year strategic plan, and is now planning to open an office in Brussels, with 10 lawyers specializing in antitrust and competition.

“What we’re seeing is not so much growth — you can’t create antitrust lawyers overnight — as repositioning in the marketplace,” said Sean Boland, co-chairman of the Baker Botts global antitrust practice and part of the Howrey team that joined in March. “Firms that are strong in antitrust that had a good couple of practitioners didn’t have the depth they wanted. Baker Botts has always done antitrust deals but the Howrey group gave the firm additional scope and scale.”